Government allocates over £4.5bn to British Business Bank

The British Business Bank is set to receive more than £4.5 billion in fresh funding as part of the UK Government’s newly unveiled ‘Backing Your Business’ small business plan, the Department for Business and Trade announced today.

The funding will significantly expand the Bank’s capacity to support small and growing businesses across the UK, by strengthening four of its flagship initiatives and extending support through the 2025 Spending Review period.

Key initiatives benefiting from the increased investment include:

Growth Guarantee Scheme: Extended to 5 April 2030, providing long-term certainty to lenders and borrowers. Since its inception in August 2022, the scheme has already enabled over £2.6 billion in finance through 16,000+ facilities.
Start Up Loans Programme: Set to deliver over £1 billion in new lending, aiming to support 69,000 entrepreneurs over the period, with a rise in average loan size to £15,000. The programme could generate an estimated £3.1 billion in turnover and create over 12,000 jobs.
ENABLE Guarantees Programme: Its capacity is being raised from £2 billion to £5 billion, increasing the ability of finance providers to offer loans to smaller businesses.
Regional Angels Programme: Receiving an additional £340 million—boosting access to early-stage equity and expected to support around 800 businesses and generate £2.9 billion in additional economic output.

These expanded programmes form part of the Government’s broader commitment to strengthen the UK’s business environment. The Bank’s total financial capacity will rise to £25.6 billion from April 2026, enabling a two-thirds increase in annual investments to around £2.5 billion.

British Business Bank CEO Louis Taylor welcomed the announcement, saying: “This will provide essential additional capacity and certainty for these key debt and equity funding programmes to support everyday businesses and the start-up economy.

“We look forward to supporting even more smaller businesses in reaching their full potential, while generating further economic growth, jobs and prosperity across the UK’s Nations and regions.”

Louise McCoy, Managing Director of Start Up Loans, added: “Increased finance for would-be entrepreneurs to start up and grow a business is vital in helping to support growth and additional employment across the UK.”

Also highlighted in the broader small business plan are upcoming reforms to the Bank’s governance and financial structure, allowing it to re-invest returns more flexibly and operate with a permanent capital base. This follows previous announcements, including a new £4 billion Industrial Strategy Growth Capital initiative targeting eight key sectors.

Stephen Haddrill, Director General of the Finance and Leasing Association, praised the move: “It is great to see the BBB’s key initiatives put on a long-term footing to drive optimism and confidence, and most importantly, investment decisions that will make individual businesses better equipped this year than last.”